Voting 6-2, the U.S. Court of Appeals in Washington today
rejected a request by business groups, energy companies and the
state of Alaska that the full court consider its challenge to
the EPA’s regulation of gases including carbon dioxide.

“The underlying policy questions and the outcome of this
case are of exceptional importance,” U.S. Circuit Judge David
Sentelle wrote in a four-page ruling. “The legal issues
presented, however, are straightforward, requiring no more than
the application of clear statutes and binding Supreme Court
precedent.”

The three-judge panel in June ruled that the EPA properly
concluded that greenhouse gases are pollutants which endanger
human health and that opponents don’t have the legal right to
challenge rules determining when states and industries must
comply with regulations curtailing emissions of them.

Companies such as Peabody Energy Corp., business groups
including the U.S. Chamber of Commerce and states led by Texas
and Virginia sought to stop the agency through more than 60
lawsuits. Some argued that the EPA relied on biased data from
outside scientists.

Considering Review

“We will continue to fight against these regulations and
are carefully considering Supreme Court review,” Jay Timmons,
president of the National Association of Manufacturers, said in
an e-mailed statement issued on behalf of two dozen business and
industry trade groups.

Votes by two judges to rehear the case “send a clear
signal that significant legal issues remain to be addressed,”
Timmons said.

Automakers intervened in support of the new standards.
Through the Alliance of Automobile Manufacturers, the carmakers
supported a national program, saying they wanted to avoid
conflicting standards from state and federal regulators.

In 2007, the U.S. Supreme Court ruled that the EPA had
authority to regulate greenhouse gases such as carbon dioxide
and methane under the Clean Air Act if the agency declared them
a public danger. The EPA issued an endangerment finding in
December 2009, clearing the way for regulation of emissions from
power plants, factories and other sources linked to global
climate change.

Power Plants

The EPA proposed the first-ever greenhouse-gas restrictions
on new power plants, the largest emitter of those pollutants,
last year, and is scheduled to complete those rules in the
coming months.

The two appeals judges who voted in favor of reconsidering
the case, Janice Rogers Brown and Brett Kavanaugh, argued that
the EPA had overstepped its authority when determining that
greenhouse gases are pollutants under the Clean Air Act.

“To find that CO2 may ultimately endanger public health
and welfare because sea levels will rise tells us nothing about
whether CO2 concentrations in ambient air directly harm public
and welfare,” Brown, who was appointed to the court by
President George W. Bush, said in her 23-page dissent.

The court also heard arguments against a 2010 rule on
motor-vehicle emissions that opponents said improperly sets
standards for stationary sources, such as steel mills and power
plants.

Tailoring Rule

The court considered challenges to the EPA’s tailoring
rule, which limits the businesses covered by carbon regulation
and phases in controls. The agency plans to phase in industrial
polluters covered by the carbon rules through 2016.

The EPA argued in court filings that the tailoring rule is
acceptable under the Clean Air Act and necessary to keep states
from being overrun with permit requests.

The regulations require only the biggest emitters, such as
power plants and oil refiners, to obtain state carbon permits
before building or upgrading facilities. State officials will
determine pollution controls case by case.

The lead case is Coalition for Responsible Regulation Inc.
v. Environmental Protection Agency, 09-1322, U.S. Court of
Appeals, District of Columbia (Washington).